What is the Meaning of Cost Per Mille?
Cost per mille, or CPM, is a pricing model used in advertising that measures the cost of a given ad per thousand impressions. CPM is typically expressed as a currency amount, such as dollars or euros, for every thousand impressions. CPM is a popular pricing model for advertisers because it allows them to calculate the cost of a given campaign with a high degree of accuracy. By knowing the number of impressions their ad will receive, advertisers can set a budget and plan accordingly.
How Does Cost Per Mille Work?
To calculate the cost of a CPM campaign, advertisers must first determine the number of impressions their ad will receive. Advertisers then multiply this number by the CPM rate to determine the cost of the campaign. For example, if an advertiser wants to run a campaign with 10,000 impressions and their CPM rate is $10, the total cost of the campaign would be $100 (10,000 x $10).
Benefits of Cost Per Mille
CPM offers several advantages for advertisers, including:
- Accurate budgeting: CPM allows advertisers to set a budget and calculate the cost of a campaign with a high degree of accuracy.
- Flexibility: CPM is a flexible pricing model that allows advertisers to adjust their budget to accommodate different campaigns.
- Cost efficiency: CPM is a cost-effective way to advertise, as advertisers only pay for the impressions they receive.
Examples of Cost Per Mille
CPM is commonly used in digital advertising, such as display ads and social media ads. For example, an advertiser might run a display ad campaign on a website with a CPM rate of $5. This means the advertiser would pay $5 for every 1,000 impressions their ad receives. Social media platforms also typically use CPM as their pricing model. For example, an advertiser might run a Facebook ad campaign with a CPM rate of $10. This means the advertiser would pay $10 for every 1,000 impressions their ad receives.
Conclusion
Cost per mille (CPM) is a pricing model used in advertising that measures the cost of a given ad per thousand impressions. Advertisers use CPM to accurately set a budget and calculate the cost of a campaign. CPM is commonly used in digital advertising, such as display ads and social media ads.